06/15/2012 03:42 pm ET Updated Aug 15, 2012

Strategic Planning Basics: Simplifying Terms & Nomenclature

It's not unusual for us to begin working with clients who have encountered frustration and confusion in their previous attempts at strategic plan development. The major cause for this confusion can be the lack of a clear, agreed-upon nomenclature for a plan's key elements. One person's "goal" is another person's "objective." "Mission" gets confused with "Vision." And what's the difference between a "strategy" and a "goal?" And so on.

So here's a simple, clear system of nomenclature that has always worked for us and our clients. It will demystify these terms, eliminate confusion, and allow you to spend your valuable time concentrating on substance -- not semantics -- in your strategic planning sessions.

A Simple, Clear Plan "Architecture"
The nomenclature system we use consists of six terms: Values, Mission, Vision, Goals, Strategies and Tactics. We call it a plan's "architecture." Now, let's define these terms one by one.

Values define what an organization stands for, believes in, cherishes. For example, "life, liberty and the pursuit of happiness," for the USA. For a company, these could be any number of concepts such as "quality," "profit," "dedication to customers," and so on.

In a for-profit setting, as Peter Drucker puts it, your Mission is defined by "what your customers pay you for." It is why you exist as a company or organization. A company that makes elevators and escalators defines its Mission as follows: "to move people and materials, vertically and horizontally, over short distances." The Mission of the American Cancer Society is "to eliminate cancer as a major health problem."

A Vision is a compelling statement that describes the ultimate future achievement or condition an entire organization is striving for. To be effective it should be a "stretch," but something that members of the company or organization would find motivating. Henry Ford's "to democratize the automobile" and JFK's "man on the moon by the next decade" are classic examples of compelling Visions.

Goals will vary, of course, by organization. For a medical instrument manufacturer, the goal "to achieve world-class quality," would be critical, whereas for a newspaper publisher "achieving editorial leadership" would be important. Goals may vary greatly, but in all cases, they represent key achievement targets for the key dimensions of an organization or business.

A Strategy is a broad method or approach for achieving a Goal. So, if my Goal is "world-class quality," I may have a strategy to "institute lean manufacturing techniques." If my goal is to be named one of "Fortune Magazine's 100 Best Places to Work," one of my Strategies might be to "formalize bi-directional communication between management and employees."

Tactics are where the "rubber meets the road." These are concrete, "actionable" initiatives or projects that can be assigned to specific individuals or teams and tagged with completion dates. Tactics represent what actually must be done to successfully implement a Strategy. For instance, my Strategy to "formalize bi-directional communication," above, might well be supported by a Tactic that requires a specific individual to "institute a regular schedule for bi-monthly 'Town-Hall' meetings" by such-and-such a date.

An Integrated "Framework" of Ideas
The most important point to be made about all these terms is their interrelationship. They must exist as an integrated "system" or "framework" of ideas. That is, they must be congruent. Therefore, if I am responsible for a Tactic, I know that it supports a specific Strategy toward the achievement of a particular Goal. That Goal is consistent with the enterprise's Mission and ultimate Vision and must be informed by the core Values we all affirm.

Ray Gagnon is Principal and Founder of Gagnon Associates, a management and organizational consulting firm with a long-standing practice in strategic planning, located in Metro-West Boston, Massachusetts, USA.